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Micro Focus launches $400 million and €400 million term loans
By Sara Rosenberg
New York, May 26 – Micro Focus International plc held a lender call on Tuesday to launch a $400 million five-year senior secured term loan B (B1//BB) and a €400 million five-year senior secured term loan B (B1//BB), according to sources.
Price talk on the U.S. term loan is Libor plus 450 basis points with a 1% Libor floor and an original issue discount of 95, and talk on the euro term loan is Euribor plus 450 bps with a 0% floor and a discount of 97, sources said.
The term loans are non-callable for one year, then at 102 in year two.
J.P. Morgan Securities LLC is the lead on the deal. Joint bookrunners are HSBC, NatWest, Barclays, BofA Securities Inc. and Goldman Sachs.
Commitments are due at 10 a.m. ET on Friday, sources added.
Proceeds will be used to partly refinance an existing senior secured term loan B due November 2021 and pay associated fees and expenses.
Other funds for the refinancing will come from $150 million of cash on hand.
The company was out with a refinancing earlier in the year, but that transaction was pulled in March due to adverse market conditions.
The prior refinancing attempt consisted of a $1.435 billion equivalent seven-year senior secured term loan B with the U.S. tranche expected to have a minimum size of $500 million and the euro tranche expected to have a minimum size of €500 million. Price talk for the U.S. term loan was Libor plus 375 bps to 400 bps with a 0% Libor floor and an original issue discount of 99, and talk for the euro term loan was Euribor plus 325 bps to 350 bps with a 0% floor and a discount of 99.5. Both loans were talked with 101 soft call protection for six months.
Micro Focus is a Newbury, England-based enterprise software company.
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